Hokkaido seeks to introduce lodging tax plan, on top of municipal taxes

Visitors staying at hotels and inns in Japan’s northern island of Hokkaido may expect to be double taxed, as the prefecture looks to introduce a lodging tax on top of the accommodation tax already present in certain municipalities.

According to Nikkei Asia, the Hokkaido prefectural government hopes to enact the lodging tax by the spring of 2026.

The tax plan is expected to be introduced during an ongoing assembly session which began on June 18, reported Nikkei Asia.

According to a draft plan drawn up by an expert panel convened in February, the lodging tax could be set at 100 yen (85 Singapore cents) for accommodation costs of less than 20,000 yen per night, 200 yen for costs from 20,000 yen to less than 50,000 yen, and 500 yen for costs more than 50,000 yen.

Those on school trips will be exempt from paying the tax.

A revenue of about 4.5 billion yen could be generated per year from the tax plan, and will be used to promote tourism through improvement works of transport infrastructure, human resources and marketing, among other measures, reported Nikkei Asia.

Talk of the Hokkaido lodging tax comes ahead a similar tax which will be imposed in Hokkaido’s Niseko town. Beginning November, a lodging tax of up to 2,000 yen per night will be imposed on visitors at the popular resort destination.

Kutchan – another part of Hokkaido – has imposed such taxes since 2019, implementing a 2 per cent tax on hotel fees from guests.

As such, visitors who stay at municipalities with their own lodging taxes will be double taxed if the Hokkaido government introduces its own.

According to Nikkei Asia, a person staying at a Niseko hotel for 20,000 yen per person per night would also have to pay a prefectural tax of 200 yen and a municipal tax of 500 yen.

The Hokkaido government aims to begin collecting on the lodging taxes only about 20 months after it is announced by the governor, reported Nikkei Asia, given that the public would need time to be made aware of the the change.

This means that if the move is announced at the ongoing prefectural assembly, the Hokkaido lodging tax will begin by April 2026.

While officials hope to roll out the tax plan, some have raised scepticism over the plan.

At public meetings held in April and May, questions were reportedly raised over the purpose and timing of the move, while committee members in the prefectural assembly raised queries about exemptions and requested more details.

More than 10 Hokkaido municipalities – including Sapporo and Hakodate – are currently also in talks to introduce their own lodging taxes.

Most municipalities are looking to introduce their taxes at the same time as the Hokkaido government in order to reduce any clerical issues for businesses and heighten awareness of the new taxes for visitors.

“We needed to begin full-scale studies at this time for the sake of simultaneous introduction (of the tax) with the Hokkaido government,” a municipal official in Otofuke, in central Hokkaido, was quoted by Nikkei Asia as saying.

About a year is reportedly needed for municipalities before the adoption of an ordinance, and then implementation, of the tax.

In 2002, Tokyo was the first city in Japan to introduce a lodging tax. The taxes have since spread to other locations like Kyoto, Fukuoka and Nagasaki.